Research on the Influence of Trade Friction on the Innovation of High-tech Enterprises in China

: This paper empirically examines the impact of trade frictions on R&D innovation in Chinese high-tech firms based on the data of three batches of the list of U.S. tariffs on Chinese exports in 2018 and the data of listed companies from 2007 to 2020, using the event of U.S. tariffs on Chinese goods as a quasi-natural experiment. It is found that:trade frictions have a negative impact on high-tech enterprises, mainly through the "cost effect" and "Schumpeter effect" to inhibit innovation.


Introduction
In the 40 years of reform and opening up, it has created miracles that have never been in the history of human economy [1]. Under the guidance of export -oriented foreign trade policies, China's foreign trade has achieved bright results. Foreign trade increased at an average of 14.5%per year. In 2013, China's total foreign trade has surpassed the United States to become the world's largest trading country. However, at present, from the global perspective, trade protectionism has risen again in some major countries. In the gradual deteriorating trading environment, China will inevitably be invaded by the uncertainty of trade barriers and trade policies. In the first half of 2018, the U.S. government launched a series of surveys on Chinese products. In July, the United States began to impose import tariffs on goods from China. Commodities mainly involved aerospace, information and communication technology, robots and machinery, medicine, etc. Foreign trade restrictions on Chinese enterprises have made Chinese companies unable to import high -tech products, hindering the innovation and development of Chinese enterprises, especially high -tech enterprises, and a severe challenge to China's innovation -driven development strategy. Since the 18th National Congress of the Communist Party of China, China has made many achievements in scientific and technological innovation and institutional innovation. As an important part of the national economy, China vigorously promotes the development of high-tech industries. From 2015-2020, the scale of China's hightech manufacturing research and test development expenditure shows a high-speed growth trend, from 262.7 billion yuan in 2015 to 2020 464.9 billion yuan, indicating the enhancement of China's comprehensive strength.
However, in the past long period of time, China has been taking the path of "technical introduction -digestionabsorption -imitation innovation -independent innovation" to catch up with developed countries with innovation [2], although technological introduction can promote the independent innovation activities of Chinese enterprises [3]，However, some high -tech enterprises in my country are still "stuck necks" in some important areas. High -tech enterprises have a pivotal position in China's scientific and technological innovation and development, and play a vital role in promoting China's scientific and technological innovation and development. If it does not maintain its motivation to continue innovation, it is likely to affect the development of China's high -tech industry. Even the development of innovation -driven development strategies. Therefore, in the face of gradually deepening trade barriers, how high -tech enterprises comprehensively use internal and external resources to improve their innovation capabilities, which not only has a vital impact on the development of high -tech industries, but also becomes a major topic facing the development of scientific and technological innovation in China.. Therefore, this article cuts from the perspective of micro -enterprises, and focus on what impact and influence mechanism does trade friction have had on the development and innovation of China's high -tech enterprises? In -depth research on trade friction and innovation issues of high -tech enterprises help us analyze the impact of trade friction on high -tech enterprises, and provide policy recommendations for related trade barrie.

Emphasis on the impact of trade friction on China's high -tech enterprises' innovation 2.1 Model settings
In order to explore the impact of trade friction on the development and innovation of my country's high -tech enterprises, this article takes the measures of the US export products in China in 2018 as a quasi -natural experiment to build the following dual differential (DID) model: (1) Among them, represents the level of R&D and innovation in the enterprise i in the industry j,and the R&D investment of enterprises is selected as the measurement index of R&D innovation of enterprises, and the ratio of R&D investment to operating income is used to measure it in the empirical study;time is a virtual variable with values of 0 and 1, with values of 0 before 2018 and 1 after 2018;treat means that the value is 1 when the enterprise is affected by tariff increase, and 0 when it is not affected by tariff increase. The coefficient of time×treat is the influence of trade friction on the innovation of high-tech enterprises that this paper is concerned about. X represents control variables, including enterprise scale, enterprise age, enterprise debt level, return on assets, Tobin Q value, enterprise property right nature and equity concentration. In addition, and are fixed effects of year and enterprise respectively, and is a random disturbance term.

Data source and processing
This paper studies the influence of trade friction on R&D innovation of high-tech enterprises in China, and selects the R&D investment of A-share high-tech listed companies in Shanghai and Shenzhen stock markets from 2007 to 2020 as the research object. The empirical study mainly involves three types of data. The first type of data is the list of three batches of tariffs imposed by the United States on China's $250 billion goods in the second half of 2018. The data comes from the Office of the US Trade Representative; The second kind of data is the R&D investment data of high-tech listed companies, which comes from CNRDS-CIRD database; The third kind of data relates to the basic information and financial data of enterprises, which come from CSMAR database. In this paper, the US tariff on China in 2018 is taken as an example to study the impact of trade friction on the innovation of high-tech enterprises in China. It is necessary to establish a relationship from the US tariff list to the R&D innovation of high-tech and new-tech enterprises in China. Since the tariff list of goods is HS6digit code (HS2017), HS2017 is mapped to HS2002 according to the correspondence table between HS2017 and HS2002 provided by the Statistics Department of the United Nations Department of Economic and Social Affairs. Then, according to the corresponding relationship between HS code and national economy industry compiled by Sheng Bin [4], finally, the standard industry code is matched with high-tech listed companies to realize the corresponding matching between the tariff list and high-tech enterprises.

Descriptive statistic
For the samples participating in regression, the statistical analysis of the main variables in this paper is shown in Table 1, with a total of 17,141 regression samples.  Table 2 shows the results of benchmark regression of model (1).The first column shows the average influence of trade friction on R&D innovation of high-tech enterprises after controlling the influence of macroeconomic factors that do not change with enterprises and the fixed time effect. The results show that there is a significant negative correlation between trade friction and R&D investment of high-tech enterprises. The second column add the control quantity on the basis of the first column, and the regression results are basically unchanged, which shows that trade friction negatively affects the innovation activities of high-tech enterprises, that is, trade friction has an inhibitory effect on R&D and innovation of high-tech enterprises.

Robustness test
The premise of using double difference estimation is that the treatment group and the control group meet the parallel trend hypothesis, that is, the development trend of the result variables in the treatment group and the control group is the same without policy intervention. Therefore, in order to prove the validity of the results, this paper tests the parallel trend of the double difference model. Figure 1 draws the results of parallel trend test. It is found that there is no obvious difference between the treatment group and the control group before 2018, which satisfies the parallel trend hypothesis.
In order to further rule out the possibility of other random factors leading to the current results, this paper tests the placebo effect by advancing the time of tariff increase in the United States in 2018 by two years and three years respectively. If the high-tech enterprises affected by the United States tariff increase during the sample period have certain characteristics that lead to the current conclusion, then the current conclusion should also be drawn by advancing the time when the United States tariff increase occurred. The estimation results in Table 3 show that the coefficient of interaction term is not significant whether it is two years or three years ahead of schedule, which means that the innovation ability of high-tech enterprises affected by the US tariff increase is not reduced because of other characteristics, and the core conclusion of this paper is still stable.

Conclusion
In this paper, the US tariff increase on China in 2018 is taken as a quasi-natural experiment, and the DID model is constructed to empirically test the impact of trade friction on the innovation of high-tech enterprises in China. It is found that trade friction has a significant inhibitory effect on the R&D innovation of high-tech enterprises, which reduces the R&D investment of enterprises. The conclusion of this paper has important policy implications. The research results of this paper show that trade friction negatively affects the innovation investment of high-tech enterprises. Therefore, under the background of rising trade protectionism and anti-globalization tide, relevant departments should consider the influence of trade friction on economic activities and enterprise innovation activities when introducing and adjusting innovation incentive policies to enhance the independent innovation ability of enterprises and improve the national innovation level.